Deputy Commissioner of Income-tax, V. Drillbits International Pvt. Ltd., Nashik

ITA 1507/PUN/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1821 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 10 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 25-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DHEERAJ KUMAR JAIN
• Assessee Lawyers: VIRAJ SHETH
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI PRADIP KUMAR KEDIA , A M . / ITA NO. 1 507 /PN/201 4 / ASSESSMENT YEAR : 20 1 0 - 11 THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE 3(1), DHULE . / APPELLANT VS. DRILLBITS INTERNATIONAL PVT. LTD., PLOT NO.66, MIDC ESTATE, SATPUR, NASHIK 4220 07 . / RESPONDENT PAN: AACCD1726B / APPELLANT BY : SHRI DHEERAJ KUMAR JAIN / RESPONDENT BY : SHRI VIRAJ SHETH / DATE OF HEARING : 25 . 0 5 .201 6 / DATE OF PRO NOUNCEMENT: 27 . 0 5 .201 6 / ORDER PER SUSHMA CHOWLA, J M : TH IS APPEAL FILED BY THE REVENUE IS AGAINST THE ORDER OF CIT (A) - I , NASHIK , DATED 27 . 0 5 .20 1 4 RELATING TO ASSESSMENT YEAR 20 1 0 - 11 AGAINST ORDER PASSED UNDER SECTION 1 4 3(3) OF THE INCOME - TA X ACT , 1961 (IN SHORT THE ACT) . 2 . THE REVENUE HAS FILED THE FOLLOWING GROUNDS OF APPEAL: - 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) - I, NASHIK WAS JUSTIFIED IN DELETING THE ADDITION OF RS.50,80,000/ - ON ACCOUNT OF DISA LLOWANCE OF APPELLANTS CLAIM OF DEPRECIATION ON TECHNICAL KNOWHOW? 2. THE APPELLANT PRAYS THE ORDER OF THE ASSESSING OFFICER MAY BE RESTORED. 3. THE APPELLANT PRAYS TO ADDUCE SUCH FURTHER EVIDENCE TO SUBSTANTIATE HIS CASE. ITA NO. 1 507 /PN/20 1 4 DRILLBITS INTERNATIONAL PVT. LTD. 2 3. THE LEARNED AUTHORIZED RE PRESENTATIVE FOR THE ASSESSEE AT THE OUTSET POINTED OUT THAT THE ISSUE RAISED IN THE PRESENT APPEAL FILED BY THE REVENUE IS SQUARELY COVERED BY THE ORDERS OF TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO.1361/PN/2010 RELATING TO ASSESSMENT YEAR 2006 - 07 , ORDER DATED 23.08.2011 AND IN ITA NO.1537/PN/2011 & CO NO.01/PN/2012 , RELATING TO ASSESSMENT YEAR 2007 - 08 , ORDER DATED 26.06.2012 . THE ISSUE ARISING IN THE PRESENT APPEAL IS AGAINST DELETION OF ADDITION OF RS.50,80,000/ - MADE ON ACCOUNT OF DISALLOWANCE OF ASSES SEES CLAIM OF DEPRECIATION ON TECHNICAL KNOWHOW. 4. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE WAS A PRIVATE LIMITED COMPANY ENGAGED IN THE BUSINESS OF MANUFACTURING EXPORTER, IMPORTER AND MARKETING OF ROCK ROLLER, DRILLING BITES AND MINING EQUIPMEN TS. THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION AS IN THE EARLIER YEARS HAD CLAIMED DEPRECIATION ON TECHNICAL KNOWHOW BEING AN INTANGIBLE ASSET FALLING WITHIN THE DEPRECIATION ON TECHNICAL KNOWHOW BEING AN INTANGIBLE ASSET FALLING WITHIN THE MEANING OF ASSET ENTITLED TO DEPRECIATION AS ANY OTHER BUSINESS OR COMMERCIAL RIGHTS OF SI MILAR NATURE. HOWEVER, THE SAID CLAIM OF ASSESSEE WAS REJECTED BY THE ASSESSING OFFICER SINCE SIMILAR DISALLOWANCE WAS MADE IN THE EARLIER YEARS. THE SUBMISSIONS OF ASSESSEE THAT THE TRIBUNAL HAD ALLOWED THE CLAIM OF ASSESSEE IN EARLIER YEARS, WAS NOT AC CEPTED BY THE ASSESSING OFFICER SINCE APPEAL WAS FILED BEFORE THE HONBLE HIGH COURT ON THIS ISSUE. 5. THE CIT(A) ON THE OTHER HAND, FOLLOWING THE RATIO LAID DOWN BY THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEARS 2006 - 07 AND 2007 - 08 ALLOWED THE CLAIM OF ASSESSEE. THE RELEVANT PORTION OF THE ORDER OF TRIBUNAL FOR ASSESSMENT YEAR 2007 - 08 IS REPRODUCED BY THE CIT(A) AT PAGES 5 TO 7 OF THE APPELLATE ORDER. ITA NO. 1 507 /PN/20 1 4 DRILLBITS INTERNATIONAL PVT. LTD. 3 6. THE REVENUE IS IN APPEAL AGAINST THE ORDER OF CIT(A) AND THE LEARNED DEPARTMENTAL REPRESENT ATIVE FOR THE REVENUE PLACED RELIANCE ON THE ORDER OF ASSESSING OFFICER. 7 . WE FIND THAT THE ISSUE RAISED IN THE PRESENT APPEAL BEFORE US IS SQUARELY COVERED BY THE ORDER OF TRIBUNAL IN ASSESSEES OWN CASE RELATING TO ASSESSMENT YEARS 2006 - 07 AND 2007 - 08. THE RELEVANT FINDINGS OF THE TRIBUNAL ARE REPRODUCED BY THE CIT(A) , WHICH HAVE BEEN REFERRED TO AND NOT BEING REPRODUCED FOR THE SAKE OF BREVITY. FOLLOWING THE SAME PARITY OF REASONING, WE UPHOLD THE ORDER OF CIT(A) AND DISMISS THE GROUNDS OF APPEAL RAI SED BY THE REVENUE IN THIS REGARD. 8 . IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON THIS 27 TH D AY OF MAY , 201 6 . SD/ - SD/ - (PRADIP KUMAR KEDIA) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 27 TH MAY , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLAN T ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - I , NASHIK ; 4. / THE CIT - I , NASHIK ; 5. , , / DR A , ITAT, PUNE; 6. / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE